Banana fiber/tapioca starch (BFRTPS) composites modified by magnesium hydroxide (Mg(OH)2) were prepared with glycerin as the plasticizer, banana fiber as reinforcement and thermoplastic tapioca starch as matrix. Rheological properties testing showed that Mg(OH)2 take a strong effect to the preparation processing and made it hard to mix while the content increasing. Mechanical properties testing revealed that at the range of the Mg(OH)2 content from 5 to 20phr, the tensile strength of the composites increased from 12.8MPa to 24.8MPa at 15phr Mg(OH)2 content, but its elastic modulus was increased with the increasing of Mg(OH)2, reached the maximum of 3100MPa at 20phr Mg(OH)2 content. Obviously, Mg(OH)2 has an enforced effect to the composites. Combustion performances of the composites was improved by Mg(OH)2, the limited oxygen index(LOI) of the composites reached to 31% while the content of Mg(OH)2 was 20phr, and then the result of flammability testing achieved UL94HF-1 and UL94 V-0 level.